Hey friend,

If you've been eyeing healthcare as your "recession-proof" backup plan after a layoff, I need to tell you something that might save you months of confusion. The healthcare industry is running at two completely different speeds right now, and understanding which lane you're in could make or break your job search.

The maddening paradox: Hospitals across America are laying off thousands of workers while simultaneously claiming they're in a desperate nursing shortage. It sounds like corporate double-speak, but it's actually a complicated reality that's catching a lot of job seekers off guard.

Let me walk you through what's actually happening, and more importantly, what it means for you.

The nurses at Long Beach Memorial in California learned this paradox the hard way.

In early May 2025, MemorialCare announced it would lay off 78 registered nurses during contract negotiations. That number eventually grew to 115 positions cut in a single round, following 60 job cuts just two months earlier, all while citing a $40 million budgetary shortfall.

✔️ The nurses voted overwhelmingly to authorize a strike
✔️ They held informational pickets demanding safe staffing levels
✔️ They watched the hospital announce layoffs on May 1st (International Workers' Day, of all days)
✔️ When they struck for one day, management responded with a four-day lockout

"During negotiations at the beginning of May, the hospital announced the layoff of 78 registered nurses," said Brandy Welch, a pediatrics RN. The union representative described the situation as breaking the hearts of nurses who are "critical to our Long Beach community."

The brutal irony? These same hospitals still claim they struggle to recruit nurses. Welcome to healthcare's two-speed labor crisis.

The scale of healthcare layoffs in 2025 is staggering.

The Xtalks Healthcare Layoffs Roundup documents cuts at 65+ hospitals and health systems this year alone:

Yet the nursing shortage is very real.

According to Vivian Health's analysis of HRSA data, the United States faces a deficit of approximately 295,800 registered nurses nationwide. The gap between supply and demand isn't closing. Thirty-four states will have nursing shortages in 2025, and 29 states will still face shortages in 2037.

So who's actually getting cut?

The pattern becomes clear when you dig into the layoff announcements. The Chief Healthcare Executive reported that federal health workers came to work "only to find out that they were laid off without any advance warning and denied access to their offices."

Most layoffs target:

But nursing isn't fully protected either, as Long Beach Memorial and Providence Health (which laid off over 100 certified nursing assistants) have shown.

Understanding why helps you predict which organizations are stable and which are vulnerable.

1. Nursing Is Treated as a "Cost Center"

According to Empowered Nurses, "cutting nursing staff can be an easy target for quick savings since nursing is considered a cost center and not a revenue-producing center." When CFOs need to cut budgets, nurses become an expense to reduce rather than an investment to protect.

2. The Travel Nurse Cost Hangover

Nurseslabs reports that COVID-era travel nurse premiums drove hospital labor expenses up 20-30%. Now hospitals are over-correcting. The 2025 NSI Report found 74% of hospitals want to reduce travel nurse reliance, and eliminating 20 travel RNs saves $1.58 million annually. The irony? Cutting permanent staff often forces hospitals right back to expensive travelers.

3. Profitable Systems Making "Preemptive" Cuts

Some layoffs are happening at hospitals still in the black. The NYSNA reported that NewYork-Presbyterian cited "looming macroeconomic changes" that haven't occurred yet, even while earning a $97 million surplus.

At UC San Diego Health, KPBS reported workers saying: "They made no cuts at the top. They gave themselves a pay raise a week after firing staff." This despite $340 million in profits.

4. The Reimbursement Squeeze (Unevenly Applied)

Hospitals cite declining Medicare/Medicaid reimbursements as the pressure. But when Providence blamed nurse wages for Oregon layoffs, OPB reported unions calling it "unfair and dishonest... while Providence's top executives earn millions."

5. Different Roles Being Cut vs. In Shortage

The layoffs and shortage don't affect the same positions. Nurse.org noted that at Providence, "RN hiring remains steady" while CNA roles are cut. This creates a vicious cycle: cut support staff, overload remaining RNs, burnout increases, more nurses leave, shortage worsens.

6. Short-Term Thinking, Long-Term Damage

Empowered Nurses warns that layoffs "send a demoralizing message... reinforcing the idea that [nurses] are replaceable," which drives more nurses away from the bedside and deepens the staffing crisis even further.

The bottom line: This isn't just financial necessity. It's a system treating frontline workers as expendable while executive pay and hospital expansions continue. Understanding this helps you target employers who invest in staff rather than cut them.

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Five ways to navigate this two-speed crisis:

1. Understand which "speed" your role falls into

Speed One (Cuts): Administrative functions, insurance company restructuring, hospital closures, Medicaid reimbursement drops, and AI/automation of billing roles

Speed Two (Shortage): Bedside nursing, direct patient care, rural healthcare, geriatric nursing, mental health nursing, telehealth positions

2. Target roles that are actually hiring

Based on the layoff patterns, these areas remain in high demand:

3. Consider clinical-adjacent pivots if you're in a vulnerable role

If you're in healthcare administration or IT facing cuts, explore:

4. Know the financial reality and look for red flags

Hospital systems are cutting costs because of:

But also watch for warning signs of a system that's cutting opportunistically rather than out of necessity: record profits combined with layoffs, executive pay raises during "cost-cutting," and major acquisitions while claiming financial hardship.

5. Watch for warning signs at your current employer

Xtalks documented that many layoffs followed patterns: hiring freezes, service consolidations, department mergers, and "efficiency initiatives." If you see these, update your resume immediately.

Time: 45 minutes this week

Grab a notepad and answer these questions honestly:

...but it's not a sinking ship either. It's an industry running at two speeds, and your job is to position yourself in the lane that's accelerating.

The nurses at Long Beach Memorial didn't just accept their situation. They organized, they struck, and they're still fighting for better conditions. Their courage reminds us that understanding the system is the first step to navigating it, or changing it.

If you're in healthcare right now, take the weekly challenge seriously. If you're considering healthcare as your next move, know exactly which roles are growing and which are getting cut.

This industry still heals people. With the right strategy, it can still heal your career too.

Rooting for you,

Win
Fellow layoff survivor, creator of Let Go Weekly